Market Update – Price and market action tell everything; Stay objective and free of cognitive bias; More thoughts on real estate

I have uploaded a Markets podcast for August 20, 2018. Click here to go to the show archives page to download the podcast, or you can listen on the link below.

The stories of woe and the market action in the crypto market are identical to the situation with the Nasdaq in late 2000, the gold and silver markets in late 2013, and real estate in 2010. Hope and desperation do not make the markets rise. The crypto shills are at least disingenuous and are full of conflicts of interest. Ronnie Moas has an expensive crypto service, but he lies to his subscribers and says we cannot determine the markets by looking at charts and market action. He is shilling to the bitter end while his subscribers cry the blues.

-We should appreciate the Ronnie Moas shilling as trading is a zero-sum game (minus-sum after trading costs). So, if we make 100k in cryptos his subscribers lose 100k.
-Stop using the social media platforms to get news and trading ideas. They are only echo chambers that reaffirm preexisting confirmation biases.
-80% of futures traders lose money. Only 10% of traders make money. Only trade when we can locate opportune instances. The COT reports can help us, especially when they reveal overstretched markets.
-Private Equity firms are still getting involved in real estate. Cerburus Capital is raising $500mm to purchase single-family rental homes.
-Be flexible with real estate investment. If a person is interested in real estate and he or she lives in a high-priced market (e.g. Toronto, San Francisco) look outside the area. I know of one Los Angeles investor who buys in Barstow and Apple Valley. I know of another LA resident who concentrates in Albuquerque.
-If you decide to invest outside your area, just develop a relationship with a Realtor in the target area who knows exactly what you are looking for. They can manage your real estate portfolio, too.
-I would rather own 4-5 cash cow single-family properties than own a 7-11 franchise. Imagine dealing with all those customers and the hours are endless.
-The FOMC minutes come out Wednesday. Jerome Powell speaks Friday morning at Jackson Hole. With Trump and his demagoguery of criticizing the Fed, we may get some dovish hints. The US Treasury is already cornering the 10-year UST futures market. And the Large Commercials work with the Fed.
-Trading is a mental game. Develop a style that works with you. Trading services are usually a waste of money. There are thousands of way to trade successfully. Our flaws and cognitive biases are our worst enemies.